Frozen Seafood is a Rising Star in China’s Sam’s Clubs

Sam’s Club, owned by Walmart, has been targeting high-end consumers in China. Promoting fresh food has been its differentiation strategy in the Chinese market where locals show more and more preference to such products. According to its recent report, its frozen seafood sales has ballooned and makes up about 70 percent of the stores’ total seafood sales.

Among all frozen seafood, the imported ones and those private-label ones have performed especially well and the ratios of their sales to the total have doubled compared with last year. Frozen seafood products are popular among the customers of Sam’s Club thanks to strict quality control and the products’ high nutrition. Although Chinese prefer live seafood, some are not as fresh as expected because of long transportation times and temporary storage.

Sam’s Club has abandoned its live seafood business and focused on the sales of frozen seafood since 2014. These seafood products are processed shortly after being caught and then delivered to the stores through cold chain logistics. It has further promoted imported seafood and private-label products in 2015. Some of them have become widely received among buyers in no time.

The stores have sourced quality seafood and applied advanced technologies in processing procedures to ensure food safety and high nutrition. For example, it has bought wild king crab from the Barents Sea to provide consumers with better king crab legs.

After roughly 20 years’ hard work, Sam’s Club has more than 2.1 million members in China. As its statistics show, frozen seafood has won the recognition of these members. The company’s sales has increased 30 percent in 2017 from that of 2016. Its SKU numbers have tripled now compared with that of 2016. The stores can sell hundreds of tons of frozen seafood such as white shrimp every year.

So far Sam’s Club has operated 22 stores in China’s first-tier cities like Beijing, Shanghai, Shenzhen and Guangzhou. And with the development of e-commerce, it also tends to develop new markets through online shopping platforms. Consumers in Shenzhen and Shanghai can have its commodities delivered to their doorsteps through its virtual stores. According to its plan, the company will import more frozen and high-end seafood to satisfy Chinese consumers with deep pockets.